Home ›› 24 Jun 2021 ›› Front
A World Bank report said that more than 40 per cent manufacturing firms in Bangladesh still use handwritten documents for business administration and three-fourth of them carry out manual inspection for quality control.
The report ‘Gearing up for the Future of Manufacturing in Bangladesh’ was released on Thursday.
It found that most of the firms still use basic or near-basic technologies which it identified as a challenge to productivity in Bangladesh.
WB said that the manufacturing sector could improve productivity by strengthening innovation and adopting technology in firms.
Half of the manufacturing firms are run by undergraduate people, finds the report.
Firms having graduate managers have 10 per cent higher level of technology comparing to those run with undergraduate managers, the report added.
The report laid stress on building human capital and enabling firms’ access to advisory services in cost-effective ways.
The report said improving manufacturing sector’s productivity would be crucial for Bangladesh to boost export growth and help the economy rebound from the impacts of Covid-19 pandemic.
It also identified capability of managers and workers, connectivity to international markets and complementary markets and institutions as pillars to overcome the Covid impact.
Adopting new technologies and business practices would also help firms recover faster from the Covid-19 crisis, added.
World Bank Country Director for Bangladesh and Bhutan Mercy Tembon said, “Bangladesh’s success in readymade garments export has created about four million jobs and driven economic growth. But, in recent years, job creation in the RMG sector slowed due to automation and the trend will likely accelerate in the post pandemic world.”
Bangladeshi manufactures urgently need to shift gears from competing on low labor-intensive productivity to competing on higher productivity adopting better technologies across business functions and production processes, she said.
The report said that the firms doing business with multinational companies use more advanced technology than those working only in the local market.
The report also found export diversification beyond the apparel sector as crucial.
It called for reducing restrictions on international trade and Foreign Direct Investment, making the duty-free import of raw materials more accessible to firms outside the RMG sector and modernising special economic zones will help diversify export-led growth.
About half of the surveyed small and medium enterprises identified lack of financing as the main barrier for adopting technology.
Siddharth Sharma, WB’s senior economist and also a co-author of the report, said that an export-led manufacturing sector could create sustainable and better-paying jobs by adopting better technologies in Bangladesh.
